for automotive purposes, when will a true rms meter be needed?

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Typically, a DMM will average a signal to determine the value to display. For many DC applications, this is not an issue if the signal is a steady voltage. The issue comes up when looking at complex signals that vary like a sine wave or a DC signal with pulses. A meter that is averaging might ignore the energy contribution of pulses such as spikes or drop outs. From an energy stand point, pulses going up or down in amplitude can affect the amount of energy in a circuit. A true RMS meter does not determine value to display on a math equation, instead it uses a special thermocouple circuit to determine how much energy is in the signal. The result: a true RMS meter will result in a more accurate representation of the signal.

For example, the automotive alternator outputs DC. If the diode is bad resulting in a repetitive drop out, a true RMS meter is more likely to catch the drop out.

Do you need a true RMS meter? If you are going to get a meter get a true RMS. The nesxt step is to get a lab scope. With a lab scope you can see exactly what a signal is doing.